Musk seems to have purchased shares without notifying his shareholders.
Twitter’s stock surged up to $49.97 after the release of the filing.
Tesla CEO Elon Musk has never failed to be one of the prime protagonists in the crypto world. The US Securities and Exchange Commission (SEC), Fed’s independent market regulator, demands investors with more than 5% ownership of a company’s shares to file a “public form”, disclosing the details of their current stakes. The filing should be made within a deadline of 10 days.
On March 14, the acquisition of a 5% stake in the microblogging platform required Musk to submit an SEC filing within March 24. But violating this, Musk delayed the filling until April 4. This urged the Fed regulator to begin the investigation on this “delayed disclosure”.
Prolonged Dispute
The stake report revealed that 9.2% of Twitter’s shares were owned by Musk. Musk provided no justifications for surpassing the deadline. No official report has been made on the profits gained by Musk during this delay. Analysts estimate that Musk would have been able to save more than $143 million by delaying the filing.
The SEC has always been in fallout with Musk. His spontaneous tweets violated SEC regulations ever since 2018. His tweet in 2018 on taking Tesla private with secured funding triggered the regulators to demand Musk review his tweets before publishing. Also, he held a poll asking the public whether to sell his 10% stocks of Tesla or not raised controversies.
His $44 billion Twitter takeover in late April topped the headlines. As per the SEC filing on May 4, giant investors such as Sequoia ($800M), Binance ($500M), Dubai’s VyCapital ($700M), and Oracle’s Co-founder Lawerence J Ellison ($1B) pooled their investments in Twitter. Thus, Musk’s Twitter was able to acquire $7 billion in total. But all these didn’t seem to profit Tesla as it witnessed a 23% drop in its stocks since April 4.